Mastercard agrees $300m cornerstone backing for IPO of PE-backed Network International

Mastercard has agreed to make a $300m cornerstone investment in the planned London IPO of private equity-backed payments processing business Network International.

The companies have also agreed to enter a strategic partnership to support and accelerate the development of electronic payments in Africa and the Middle East – the world’s least well penetrated payments markets.

Network International is owned by Dubai’s largest bank, Emirates NBD, and private equity majors Warburg Pincus and General Atlantic.

Mastercard said it would pay or invest through Network International annually for the development and delivery of shared innovation to expand product areas and drive the adoption of digital payments in Africa and the Middle East.

The pair will establish shared development projects and cross-referral arrangements for products and value-added services to financial institutions and merchants, including cyber and intelligence tools and tokenisation solutions, to drive incremental financial benefits to both parties.

Mastercard’s cornerstone investment will be based on the same terms as institutional investors participating in the IPO, subject to a 9.99 per cent ownership limitation, a 24 month lock-up period and a 36 month standstill not to acquire additional shares without Network International Board approval.

The transaction is conditional on an IPO of Network International with an institutional free float of at least 25 per cent.

Network International CEO Simon Haslam said, “Mastercard has been an important partner for Network International in the Middle East and Africa for many years with both companies having a shared vision for growing the card payments ecosystem in the region.

“Today’s announcement will see both parties working on joint development projects and cross-referral arrangements to drive card penetration, usage and acceptance in the MEA region.

“In addition, it will also enable us to develop and offer new value-added solutions for our clients, through our scalable and secure pan-regional technology platforms.”

Raghu Malhotra, president of Middle East and Africa at Mastercard, added, “Over the last 30 years Mastercard has significantly expanded its footprint and capabilities across the Middle East and Africa – rapidly transforming to become one of the leading technology companies in the region today.

“…we believe that Network International’s broad geographic reach will complement our existing activities 2 and help to deliver a deeper and sustained shift from the use of cash and checks.”

Copyright © 2019 FinTech Global

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